from the one-down,-way-too-many-still-to-go dept

The world's longest running patent trolling sideshow has finally been shut down. Eolas, a company with no products on the market, claimed to have invented "interactivity on the Web," based solely on a program created by Michael Doyle back in 1993, as the director of the computer lab at UC San Francisco. This program allowed doctors to view embryos online and was patented in 1994.

Doyle took the patent and created a company he called "Eolas," the Irish word for knowledge. Eolas never made a marketable product, but it ultimately launched a patent war that made Doyle a rich man. In 1999, he filed a lawsuit saying that Microsoft's Internet Explorer violated his patent on "interactive" features on the web; the suit resulted in a $540 million jury verdict. Appeals ensued but were inconclusive; the case ultimately settled out for more than $100 million, with just over $30 million going to Eolas' co-plaintiff, the University of California.

Meanwhile, Eolas' original patent was getting serious attention. It was actually denounced by the web's global standard-setting body in 2003. That resulted in an unusual director-ordered reexamination at the US Patent Office, but Eolas somehow emerged unscathed.

Eolas got a second patent similar to its first in 2009. By then, the business of "patent trolling" had matured and become fantastically lucrative. The company relocated to East Texas before filing suit against 20 big companies, including Apple, Perot Systems, Blockbuster, eBay, Adobe, Google, Yahoo, and Amazon. Court documents show the company was seeking more than $600 million in January 2012, a damage demand that likely had inflated to more than $1 billion by the time of trial.

This activity culminated in a very unlikely event: the inventor of the Web, Tim Berners-Lee, making his first appearance in a courtroom (East Texas, obviously) to testify against Eolas and its baseless claims about controlling key aspects of the Web. This reprised a personal effort Berners-Lee had made nearly a decade earlier when he sent a long letter to the USPTO detailing prior art and asking for the patents to be invalidated.

Fortunately, this East Texas jury went against the grain and found Eolas' patents invalid. Eolas, of course, appealed this decision (and filed an infringement lawsuit against Facebook, Disney and Wal-Mart -- presumably a reflexive action at this point). The appeal went just as badly for Eolas as its East Texas battle.

Now Eolas appears to be gone for good. The company mounted a lengthy appeal, but it was all for naught; this morning, a three-judge appeals panel affirmed the jury's verdict without comment.

With its key patents shut down, Eolas has voluntarily stayed its current lawsuits. But its decade-long string of legal activity paved the way for the many trolls that have followed in its footsteps. The good new is that courts are finding their activities (and their patents) more than a little dubious. With added heat coming from FTC and the administration, there's hope that future patent trolls will find the usual road to riches -- threats and settlements -- a bit more uphill and obstacle-laden.

Other efforts in the private sector, like Newegg's refusal to back down when threatened by patent trolls and various prior art tools being utilized to sink lousy patent apps before they can be approved, should help minimize the damage done by non-practicing entities. In lieu of TRUE patent reform, this is the best companies and individuals can do to protect against entities that stunt true innovation and enrich themselves with the efforts of others.

from the they-won't-give-up dept

We've been writing about the patent troll Eolas for about a decade at this point. It's a trolling operation connected to the University of California, and used to take some ridiculously broad patents and try to shake down companies who actually innovated and did incredibly obvious things on the internet. Eolas' various lawsuits had gone back and forth over the years, and finally, earlier this year, a jury in East Texas (surprisingly) invalidated some of the key patents.

This summer, the judge in the case agreed that the key patents were invalid. Eolas had ridiculously tried to argue that the fact that some other companies had previously licensed the patents should have been shared with the jury to prove the "validity" of the patents. Of course, that's ridiculous on its face as trolls often convince companies to license bogus patents because it's cheaper to settle and license than to fight a bad patent lawsuit (even if you win). Of course, the judge blasted Eolas over this desire... because earlier in the case, Eolas had specifically argued that the jury shouldn't be allowed to know of Eolas' previous "business success or failure." Basically, Eolas didn't want the jury to know it was a troll without any real business. However, as the judge realized, Eolas can't hide that bit of info and then want the jury to have this other bit of info from its past.

Thus, for all intents and purposes it seemed that those two key patents -- 5,838,906 and 7,599,985 -- were effectively dead.

What's really amazing is that this scorched earth, anti-innovation effort hasn't created more backlash for the University of California, and Berkeley in particular, given its proximity to Silicon Valley. You'd think that alums of the University who work at the various innovative tech companies that keep getting sued would speak out against their alma mater. It's pretty sad to see the University of California trying to set up a tollbooth on innovation by using such ridiculous patents.

One interesting detail that emerged in the case was that the U.S. Patent Office didn't have access to the Internet in 1994 and was apparently forbidden from going on the Internet in 1997, which would make research into prior art in cyberspace somewhat of a challenge.

I'm not sure I'd use "interesting" as the adjective there. More like insane. I mean, it's pretty well-known that many patent examiners focused solely on other patents or journal articles as the key sources of prior art, rather than what was actually happening in the field, but being forbidden from going online is just crazy. Luckily for the internet, this was still a time period when most tech companies believed that software wasn't patentable -- something that changed the following year when the ridiculous State Street ruling opened the floodgates. While certainly some really bad patents (like Eolas') made it through, just think how much worse things would have been if there were as many internet/software patent filings from 1990 to 1998 as there were after 98.

from the that-was-fast! dept

Okay, that happened much faster than I expected. Just a few hours ago, we wrote about Tim Berners-Lee telling an East Texas jury just how insane patent troll Eolas' patents were, along with their claims that all sorts of core web technologies were covered by their patents. We thought it might take some time before anything really happened in that case, but the jury took just a short while before completely invalidating Eolas' patents. Damn! Apparently the jury recognized that when the inventor of the web talks about how obvious a technology was at the time, he probably knows what he's talking about.

I wonder just how silly the long list of companies who "settled" with Eolas before the trial started feel right now.

Of course, all of that settlement money means that Eolas still has a big bank account. That means it'll appeal this ruling, and the case may still go on for a few years. But it's going to have to clear a big hurdle, and in the meantime it won't be able to sue anyone else using these patents. Score one for obviousness and a jury that recognized a patent troll trying to put up an innovation toll booth to try to demand loads of cash it didn't deserve.

from the not-this-again dept

Remember Eolas? We've written about this infamous patent troll many times, mostly focusing on its big patent fight with Microsoft over the idea of browser plugins -- a case it eventually settled. In 2009, however, Eolas came back and basically sued the web, claiming that all sorts of very basic web technologies were, in fact, infringing on a brand new, ridiculously broad patent (built on the earlier patent), 7,599,985.

However, that case has finally gone to trial, and Wired has sent Joe Mullin -- hands down the best reporter on all things concerning patents -- to cover the case. His initial report is worth reading. Unfortunately, he notes that many of the companies Eolas sued chose to settle, helping to fund Eolas' ability to take this to court. Eight companies remain fighting. Eolas is asking for $600 million from these companies -- including over $300 million from Google and Yahoo.

As he had done nearly a decade ago, web inventor Tim Berners-Lee was called to explain to the court that Eolas' claims are ridiculous and the patents should be tossed out due to tremendous amounts of prior art. Berners-Lee also pointed out that these patents "could be a serious threat to the future of the web." He didn't mince words, noting that all of this stuff was widely known in the community of technologists working on these issues well before Eolas ever came along.

Last summer there was tremendous attention paid to the problem of patents within the tech space, but much of that furor died down after the patent reform bill became law -- even though it addressed almost none of the actual complaints about how the patent system hinders innovation. Once fall came, a lot of focus shifted back to copyright issues around SOPA. But people should be very, very worried about the outcome of this case, because if it goes badly, it could lead to a massive tollbooth on internet innovation.

from the because-otherwise... dept

Well, here we go again. As you may recall, Eolas is a company that claimed to hold a patent (5,838,906) on browser plugins. The company sued Microsoft, and a long drawn-out battle ensued. Even though web inventor Tim Berners-Lee presented prior art and asked the USPTO to invalidate Eolas' ridiculously broad and obvious patent, the USPTO eventually upheld the patent (after initially rejecting claims). Even as Microsoft began presenting evidence that it actually had made use of the technology in question before Eolas applied for its patent, losses in the courts and the Supreme Court's refusal to hear the case eventually resulted in Microsoft agreeing to settle rather than continue to fight.

Since then (two years ago), plenty of people have been waiting for the other shoe to drop, concerning Eolas' plans to sue others. Now we know why it waited. It's now received a new patent -- a continuation patent, which is often used to abuse the patent system by putting forth a broad patent, then filing for continuations to make changes that let an earlier "invention" cover technologies that later become popular. In this case, the new patent (7,599,985), which basically just extends the earlier patent on browser plugins, and extends it to javascript widgets. Yes, those embeddable widgets used all over the web? It appears that Eolas thinks that those are infringing and everyone should pay up.

The new lawsuit has been filed against Adobe, Amazon, Apple, Blockbuster, Citigroup, eBay, Frito-Lay, Go Daddy, Google, J.C. Penney, JPMorgan Chase, Office Depot, Perot Systems, Playboy Enterprises, Staples, Sun, Texas Instruments, Yahoo, and YouTube. Apparently, starting small isn't part of the plan. Not surprisingly, Eolas filed in Eastern Texas using McKool Smith -- one of the most popular law firms representing patent holding firms in East Texas.

I am honestly curious how patent system defenders, who are also programmers, can defend this. I'm sure non-programmers will claim that the patent is valid, but I can't imagine how anyone who has any knowledge of basic programming principles can claim that such a patent is valid. In the meantime, tons of companies doing an incredibly basic thing on the web will now have to waste millions of dollars fighting a ridiculous patent lawsuit. How is this promoting innovation in any way shape or form?

from the such-is-life dept

Microsoft and Eolas have been involved in a patent infringement lawsuit for many years. Eolas claims a patent on the concept of embedding other applications within browsers -- basically for the concept of plugins. This patent was questioned by many people who note that plugins are a pretty common concept and it hardly seems reasonable to give a monopoly over that idea to one company. In fact, none other than web inventor Tim Berners-Lee showed prior art for browser plugins, and the Patent Office suddenly started saying that it may have made a mistake in granting Eolas the patent. Unfortunately, due to the ridiculously complicated process to get the USPTO to review a patent, it was eventually ruled that the patent could be valid. However, it recently had agreed to review the patent again.

Of course, as we've learned time and time again, since this process is so long, and the risk of losing gets costlier and costlier the longer you wait, it appears Microsoft has given up invalidating this highly questionable patent and has simply paid off Eolas in a settlement. The amount isn't defined, but Eolas is gleefully telling its shareholders to expect a dividend shortly. Once again, this highlights nearly everything wrong with the patent system and why it needs to be changed. A very broad and vague concept with plenty of prior art gets patented by a small firm that doesn't actually do anything. Then it holds up a large company that is actually offering a product to the market, and forces them to change their product, taking away functionality, while trying to collect hundreds of millions of dollars that could have gone towards further innovation. On top of that, it highlights how difficult, slow and convoluted the patent review process is that makes it so difficult to actually contest these questionable patents. In the end, it's often just cheaper to pay up, diverting money from actual innovation into the legal system. What a shame.